Nigerian Mortgage Calculator
Calculate mortgage payments at NHF (6%) or commercial bank rates (18–25%). Includes closing costs and rent vs buy analysis.
How Nigerian Mortgages Work
Obtaining a mortgage in Nigeria is significantly more challenging than in many other countries. Two main pathways exist:
1. NHF Mortgage (Federal Mortgage Bank)
The National Housing Fund (NHF) offers mortgages at 6% interest — far below commercial rates. To qualify, you must:
- Have contributed to NHF for a minimum of 6 months
- Not previously benefited from an NHF loan
- Apply through a Primary Mortgage Bank (PMB) accredited by FMBN
- Maximum loan: ₦15M for NHF mortgages (as of 2026)
2. Commercial Bank Mortgages
Commercial banks offer mortgages at market rates, currently 18–25% p.a. This makes monthly payments substantially higher and total interest costs enormous. A ₦25M loan at 20% over 20 years costs approximately ₦57M in total repayments — ₦32M in interest alone.
Key Nigerian Mortgage Realities
- High upfront costs — Legal fees, agency fees, survey, consent fees often add 5–15% to the property price
- Annual rent culture — Lagos and Abuja landlords typically demand 1–2 years rent upfront, making renting surprisingly capital-intensive
- Documentation — Title deeds (Certificate of Occupancy), Governor's Consent, land registry all add complexity and cost
- Interest rates — Rate volatility means variable rate mortgages carry refinancing risk
Example: ₦25M Property in Lagos
Adaeze buys a ₦25M apartment
20% down payment, commercial bank at 20% p.a., 20-year term.
The total cost of this ₦25M property, including all costs, is approximately ₦99M over 20 years — nearly 4 times the purchase price.
NHF Comparison
If Adaeze used NHF at 6% for ₦15M (maximum NHF loan, self-financing the rest):
At 6%, the same ₦15M loan costs ₦10.8M in interest vs ₦54.4M at 20% — a saving of over ₦43M. NHF qualification is worth considerable effort for eligible properties.
Rent vs Buy in Nigeria
The rent vs buy decision in Nigeria has unique characteristics:
Why renting is common
- High mortgage rates (18–25%) make monthly mortgage payments much higher than equivalent rent
- Many Nigerians lack the documented income history required by banks
- Property documentation and title verification is complex and costly
- Flexible accommodation matches mobile professional lifestyles
Why buying makes sense long-term
- Property values in Lagos and Abuja have historically appreciated 8–15% annually
- Naira inflation erodes the real value of fixed mortgage payments over time
- Rent payments build no equity — all money is gone at end of tenancy
- Own property provides security and freedom from landlord pressure
Nigerian rent reality
Unlike most countries, Nigerian landlords demand 1–2 years rent upfront. A ₦120,000/month apartment costs ₦1.44M–₦2.88M on first day. This upfront cost is comparable to a mortgage deposit in some cases, but builds zero equity.